The US Congress has passed new laws that effectively stop credit card transactions in online gaming.

President Bush is expected to sign and ratify the law within the next 2 weeks, when the situation will become clearer to international online gambling companies.

Two of the biggest online gambling firms, PartyGaming and 888 have made plans to suspend business with US residents when the law takes effect; this has hit their share prices heavily.

Online gambling is said to be a $12 billion a year business, with gaming websites operating in tax havens like Gibralter and Antigua. Online gaming in the US alone is said to be worth half of the total amount.

The new law makes it illegal for credit card companies to collect payments for online gaming transaction. James Leach, Representative from Iowa, said proudly, “Basically we are shutting down the payment system for Internet gambling”.

The law has affected a proposed acquisition of World Gaming by Sportingbet, whose shares fell 70%.